Just 10% of offers written by Redfin agents faced a bidding war in October—down from 39% last year and now at a 10-year low.
California was home to four of the top-five markets where bidding was most common: San Francisco (34.8%); San Jose (20.5%); San Diego (15.6%); and Los Angeles (13.7%). Philadelphia, Pennsylvania, concluded the top-five at 13.8%.
While San Francisco and San Jose reached new peaks in 2019 during October, the competition had cooled since 2018, when the bidding-war rate was 58.1% and 64.9%, respectively.
“There was a lot of hype earlier this year in the Bay Area around some big IPOs,” said Palo Alto Redfin agent Kalena Mashing. “But we haven’t seen that hype translate into a hot market, regardless of how well the IPOs did. Really, it’s not the IPO money making the market hot, it’s the perception that the IPO money could make the market hot that has really driven the local housing market this year.”
Redfin Chief Economist Daryl Fairweather said the unseasonal uptick in competition during the month could be a sign of things to come. He said there are fewer homes for sale, but home sales are rising due to low mortgage interest rates.
“All of the pieces are in place for bidding wars to become more common and for the housing market to shift back toward the seller’s favor next year,” Fairweather said. “Now may be the last chance in the foreseeable future for buyers to win a home without facing a bidding war.”
One of the housing market’s biggest casualties has been Seattle, which saw its bidding-war rate fell to 8.8%, which is below the national average of 10.1%. Last year Seattle was among the most competitive markets in the nation.
“Homebuyers in Seattle know that in the current market they don’t necessarily have to go through the emotional heartburn that comes with bidding wars,” said Seattle Redfin agent Jessie Boucher. “Even though there aren’t a ton of homes for sale right now, buyers are able to preserve their contingencies and maybe even get a great deal.”
Miami, Florida, was the nation’s least competitive market, with just 3.7% of offers facing competition. Of the major markets studied by Redfin, 13 had a bidding-war rate below the national average.